Trade Ministers Work to Forge US-Mideast Trade Zone

U.S. and Arab trade ministers have met in Jordan to advance President Bush's plan to establish a U.S.-Middle East Free Trade Zone within the next 10 years. The talks took place on the sidelines of the World Economic Forum's special meeting, aimed at reinvigorating the Middle East economy.

Secretary of State Colin Powell said improving infrastructure and breaking down trade barriers in the region could be a key in the Middle East peace process. "We want peace in the region, but with peace, you need economic development, or the people will not benefit from that peace. And to get economic development, you also need investment in the human capital that exists in the region," Mr. Powell said.

Mr. Powell and Trade Representative Robert Zoellick met with finance and trade ministers from 10 Arab countries and the Palestinian Authority to work on implementing President Bush's proposed free-trade initiative for the Middle East. Both men said they were impressed with the level of interest and the quality of the discussions.

Mr. Zoellick said the idea for a Middle East free-trade zone arose during the war in Iraq. "We recognized that it was important to not only have a [secure] environment in military terms, but also to use that as a foundation for building opportunity and hope and empowerment in the region," Mr. Zoellick said.

Mr. Zoellick said the Middle East has fallen behind much of the rest of the world in terms of global trade, with oil exports making up most of the region's trade volume. He hopes the new initiative will help invigorate other sectors of the regional economy.

Under the initiative, the free-trade deals signed between the United States and individual countries would be linked to form a regional free-trade zone.

Jordan already has a free-trade deal with the United States. Mr. Zoellick said he is negotiating deals with Morocco and Bahrain, and hopes to have them signed in six months to a year.

Jordan's trade minister, Salah Bashir, said Jordan has benefited greatly from its own free-trade deal, and the United States is Jordan's number-one export market. "Indeed, we have been among the first comers that entered to the free trade business in this region, and I am happy to say that we have seen excellent results for our economy, for employment, and for our people," Mr. Bashir said.

Mr. Bashir said other Arab ministers at the meeting expressed interest in the idea of a free-trade zone.

The Palestinian Authority has had a free-trade pact with the United States since 1995, but Mr. Zoellick said they have been unable to take full advantage of it.

Later, Palestinian Foreign Minister Nabeel Shaath told reporters the full potential of the trade agreement will not be reached, until there is a peace deal between the Palestinians and Israel.

"The problem is simply pure inability to move products and people because of the Israeli siege. And I mentioned that today at the meeting. I said, 'Mr. Zoellick, thank you very much, we do not need any more free trade agreements with the United States, we have them.' We want Mr. Powell to make sure that we are able to move our products," Mr. Shaath said.

Trade representative Zoellick said the Middle East free-trade initiative will involve several steps. He pledged U.S. support for countries in the region that want to join the World Trade Organization. The initiative would also involve changing regulations and increasing U.S. trade incentives for Middle Eastern countries.

He said, it is also important to improve the infrastructure and legal frameworks in Arab and Middle Eastern states, because investors need to believe the nations are a safe and stable environment for their capital.